The car manufacturer has announced a £200 million investment as part of a green initiative to build batteries for electric vehicles.
The prime minister, Gordon Brown, said: "Nissan's investment in a new battery plant and its hope to start producing electric vehicles here in Sunderland is great news for the local economy, creating up to 350 direct jobs and creating and safeguarding hundreds more in the associated supply chain.
"This investment is also hugely significant as we embark on building Britain's future, our plan for recovery and beyond, powered by low carbon, high-technology industries, products and services.
"Sunderland could now be a strong contender to produce electric vehicles for Nissan in Europe, and we will continue to work with Nissan to ensure this happens."
Business secretary Peter Mandelson said: "This is good news not just for the North East, but for the whole of the UK, helping to attract foreign investment and securing UK's place as a global leader in high-tech manufacturing and automotive industries.
"The collaboration between local businesses, universities and colleges will create a hub of expertise to boost innovation and accelerate business growth in this important area of ‘green' industry."
Nissan invests in new battery plant as part of green initiative and will create 350 new jobs
Nissan is to create 350 new jobs at its Sunderland plant.
